Insolvency risk of East of England firms falls for first time in 18 months
PUBLISHED: 15:14 19 November 2018 | UPDATED: 15:24 19 November 2018
The proportion of East of England businesses at an increased risk of insolvency has fallen dramatically for the first time in 18 months, new figures show.
Insolvency trade body R3 compiled the figures using Bureau Van Dijk’s Fame database shows the number of firms which are at a higher-than-usual risk of failure.
They show that eight of 11 key business sectors saw a fall in the proportion with only manufacturing, hotels and construction registering month-on-month increases.
The East’s retail sector is also performing above average, with just 37.1% of businesses at heightened risk of insolvency compared to the UK average of 38.2%, making it the third-best performer in the UK.
Sectors in the East with the lowest insolvency risk levels were agriculture (34.3%), restaurants (36%) and hotels (36.2%), while professional services (51.5%) and technology and IT (50.4%) had the highest risk.
R3 Eastern chairman Mark Upton, a partner at Ensors Chartered Accountants in East Anglia, said: “This research should not be seen as definitive proof of a turnaround in business liquidity; it is more an indicator of a possible slowdown in heightened insolvency risk.
“We should be in no doubt that a large number of our region’s businesses are still facing strong challenges to their success, but this glimmer of positivity gives some hope for the future.
“In the meantime, it is vital for business owners to monitor company finances carefully and plan for all eventualities. If cash flow becomes a major challenge, professional advice should be taken at the earliest opportunity.”